Mortgage and Debt Consolidation

Hoopsah

Hi

Just want to ask an opinion just now.

I have a mortgage with 43K left to pay (Next 15 years)

I have managed to get 22K of debt with Credit Cards and a couple of loans.

I have never missed a payment on any of them.

My property is worth 70K

I did recently release 15K on my mortgage (4 years ago) for repairs etc.

Would the bank allow me to put my 22k debts onto my mortgage?

Any help apprecieted

kingstreet

No. There isn't enough equity for that level of debt consolidation.

Hoopsah

Thanks for the reply Kingstreet.

Would they allow me to put ANY of the debt against the mortgage?

Dave_Ham

Potentially you can add some, but much will come down to an independent valuation of your property, your individual specifics and crucially the lender selected.


Some lenders will allow debt consolidation to 80% loan to value and some up to 90-95%


Bit of a minefield so be sure to use a broker, or ask some very specific questions upfront to any potential lender.

kingstreet

That would depend on your lenders maximum loan to value for additional borrowing.

You would need to ask the lender concerned.

Some lenders don't offer additional borrowing for debt consolidation, so you may wish to look at remortgage options with other lenders, although, once gain, the loan to value will be limited.

Hoopsah

Thanks again.

No idea how to work out LTV keep seeing it mentioned when I look at re-mortgaging.

Maybe try and make an appointment with the bank see what they can tell me.

kingstreet

Value of outstanding mortgage divided by value of property.

Eg - £100,000 mortgage on £130,000 property = 77% loan to value.

kingstreet

Hoopsah wrote: »

Thanks again.

No idea how to work out LTV keep seeing it mentioned when I look at re-mortgaging.

Maybe try and make an appointment with the bank see what they can tell me.

Further borrowing from your existing lender is not a remortgage. This involves a new mortgage from a new lender and using this to repay the existing mortgage and possibly raising the additional funds needed to reduce/repay other debt.

In your case, if your property is worth £70,000 with a £43,000 mortgage, your loan to value is currently 61%. If you tried to add £22k of unsecured debt to that, it would be £65k on £70k, or 93% LTV.

The question is, what will your lender (or any other lender, if remortgaging) permit in terms of loan to value - 80%?, 85%, 90%?